4.—(1) For the purposes of subsections (2)(a) (effect may be given to protected rights by the provision by the scheme of a pension which among other things satisfies such conditions as may be prescribed) and (3) (effect may be given in certain circumstances to protected rights by the purchase by the scheme of an annuity which among other things satisfies such conditions as may be prescribed) of section 28 of the 1993 Act, the prescribed conditions are that the pension or annuity gives effect to all the protected rights of the member, and that the terms on which the pension is provided, or the terms of the purchase of the annuity—
(a)satisfy the requirements of paragraphs (2) to (5); and
(b)make no provision other than such as—
(i)is necessary to establish what the initial rate and the method of payment of the pension or annuity are to be, and that it shall continue to be paid at that rate (subject only to paragraphs (3) and (6) and to the requirements of sections 51 (annual increase in rate of occupational pension) and 162 (annual increase in rate of personal pension) of the Pensions Act 1995) throughout the lifetime of the member,
(ii)is necessary to satisfy the requirements of paragraphs (2) to (5) and regulation 5, and
(iii)is permitted by paragraphs (6) to (9).
(2) The rate of the pension or annuity shall be determined—
(a)without regard to the sex of the member; and
(b)in the case of—
(i)protected rights derived from guaranteed minimum pensions by virtue of regulation 3(a) or payments or contributions in respect of employment in a tax year commencing before the principal appointed day, without regard to the marital status of the member;
(ii)a married member whose protected rights derived from section 9(2B) rights by virtue of regulation 3(b) or payments or contributions in respect of employment in a tax year commencing on or after the principal appointed day, on the basis that the member, in the event of his death, will leave a widow or widower; and
(iii)an unmarried member whose protected rights derived from section 9(2B) rights by virtue of regulation 3(b) or payments or contributions in respect of employment in a tax year commencing on or after the principal appointed day, as if in the event of that member’s death he or she will leave a widow or widower, except where the member agreed to the rate being determined on his or her life only.
(3) In the case of protected rights which are derived from guaranteed minimum pensions by virtue of regulation 3(a) or payments or contributions in respect of employment in any tax year before the coming into force of section 51 or, as the case may be, section 162 of the Pensions Act 1995, the rate of the pension or annuity shall
(a)on a date (“the first date”) not later than the first anniversary of the date on which it becomes payable, and
(b)on each anniversary of the first date,
be increased by the same percentage as that by which parts of guaranteed minimum pensions are increased by the order (if any) made by the Secretary of State under section 109 of the 1993 Act and coming into force on the first day of the tax year in which the date of the increase falls.
(4) Except with the written consent of the person to whom the pension or annuity is payable, the pension or annuity, if paid in arrears, shall be paid no less frequently than by monthly instalments.
(5) The pension or annuity shall be paid no less frequently than by annual instalments.
(6) In the case of protected rights which are derived from guaranteed minimum pensions by virtue of regulation 3(a) or payments or contributions in respect of employment in any tax year before the coming into force of section 51, or as the case may be, section 162 of the Pensions Act 1995, the pension or annuity may be increased, not more frequently than on the first date mentioned in paragraph (3) and on each of its anniversaries, but by larger percentages than paragraph (3) requires, so however that no increase is by more than 3 per cent.
(7) When the member has died, the pension or annuity may continue to be paid, at a rate which satisfies the requirements of paragraph (8), to or for the benefit of other persons if the requirements of paragraph (9) are satisfied.
(8) The requirements first referred to in paragraph (7) are that the rate shall not exceed—
(a)at any given time during the period which is within 5 years of the date on which the pension or annuity commenced, the rate at which it would have been payable if the member had been living at that time; and
(b)at any given time during any other period, one-half of the rate at which it would have been payable if the member had been living at that time.
(9) The requirements secondly referred to in paragraph (7) are that the pension or annuity shall be paid only—
(a)to the member’s widow or widower, in a case where immediately after the member’s death the pension or annuity is required by virtue of regulation 5 to be paid to him or her;
(b)to any one person, in a case to which sub-paragraph (a) does not apply;
(c)for the benefit of any child or children, if—
(i)sub-paragraph (a) does not apply,
(ii)the pension or annuity has not been paid in accordance with sub-paragraph (b), and
(iii)immediately before the member’s death the member was entitled to child benefit in respect of that child or those children, or would have been so entitled if that child or one, some or all of those children had not been absent from Great Britain;
but only for so long as that child or at least one of those children is under the age of 18; and
(d)to any one person, during any period—
(i)which is within 5 years of the date on which the pension or annuity commenced, and
(ii)which immediately follows the death of a person who died while the pension or annuity was being paid to him in accordance with sub-paragraph (a) or (b) or in accordance with this sub-paragraph, or which begins on the date on which the child or the last of the children in respect of whom the pension or annuity has been paid in accordance with sub-paragraph (c) attained the age of 18 or died under that age.